The Russian pharmaceutical industry: Joint ventures and digital engagement?

We have previously looked at aspects of the drive to improve healthcare outcomes in Russia and considered channels such as telehealth, which are part of a wider governmental focus. Since 2005, $19 billion has been spent on improving the healthcare system and so far, various interventions and programmes have led to infant mortality  being reduced by a third, and life expectancy increasing by 3 years.

In parallel to this “Health 2020” agenda, President Medvedev has a “Pharma 2020” plan, which encourages domestic production of pharmaceuticals. Currently, Russia is reliant on imported products, and Medvedev hopes to change this, through investing in the establishment of “modern advanced enterprises”, capable of producing modern medicines.

To achieve these aims, partnership with foreign companies has been encouraged, and a number of key pharmaceutical players have started to get involved, setting up joint manufacturing plants with Russian companies. The latest partnership was between Aurobindo, an Indian company, and OJSC Diod, who have formed a joint venture, Aurospharma. The  focus will be on the provision of “socially significant” medicines to the Russian, Belarusian and Kazakh markets, and the plant will be ready for business in 2013.

Such ventures are likely to bring benefit to various stakeholders – the Russian population receives improved access to good quality pharmaceuticals, the Russian economy is boosted, and investors get to share in the significant growth of the local pharmaceutical market.

What role for emerging technologies?

Setting up a joint venture has its challenges though, particularly where the parent companies are based in different countries, meaning separate organisational cultures and employees who may not share a common language . However, it is critical that internal communication is efficient and able to add value.

Large pharmaceutical companies such as Pfizer, which have acquired various smaller companies, and which operate globally, have risen to this challenge through an increasingly social approach. As well as expanding the company’s social media presence externally, Pfizer has also updated its internal communications system, re-launching the Pfizer World intranet with a greater social focus. This is intended to improve communication throughout the company and encourage the generation of fresh ideas. Companies in other sectors are doing the same – innovation company Spigit specialises in providing internal social communication solutions to a variety of companies, and has served clients such as Lloyds TSB and AT&T.

Building on the social model, a number of pharmaceutical companies have adopted an “open sourcing” model to stimulate innovation whilst reducing the cost of R&D. Such a model could work well in Russia, to help overcome problems of geographical access and maximising the impact of the country’s scientific talent. Furthermore, Russia has been said to be experiencing a social media “boom”, with rapid and sustained growth of use. Twitter use grew three-fold in 2010 and the under-24 age group in Russia is the third largest user of “advanced mobile data” in the world. According to a Comscore survey that took place in 2010, Russians spend more time on social media sites than any other nation.

To assist with the language aspect of joint ventures, Google has a range of easy-to-use tools. Google Chrome has an inbuilt translation feature, and Google’s search engine also offers a user-friendly translation tool. Judgment is of course required when using such tools (in the example below, the Russian adjective “pharmaceutical” translates into the Hindi word for “drug”), but they may be of help in facilitating day-to-day communication.


Figure 1: Pharma2020 homepage – Google Chrome automatically suggests translation


Figure 2: Google translate. Here it translates the Russian adjective “pharmaceutical” into the Hindi word for “drug”


The Russian government is prioritising the nation’s health, and accordingly, the local pharmaceutical industry. As part of this, joint ventures between Russian and foreign companies are being set up. Emerging technologies may be of help in ensuring the smooth running of such ventures, and in facilitating the design and development of new products – particularly in Russia, where engagement via social media is strong.


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